Alan Shaw | |
---|---|
Alma mater | Virginia Tech (BS and MBA) Harvard Business School |
Occupation | Business executive |
Title | President and CEO of Norfolk Southern |
Predecessor | James A. Squires |
Alan Howard Shaw is the president and chief executive officer of Norfolk Southern, a Class I railroad operating freight trains in the United States. He has held the CEO position since May 1, 2022. [1] [2]
Shaw attended Virginia Tech and received a Bachelor of Science in Aerospace Engineering [3] in 1989 and a Master of Business Administration there in 1992. At Harvard Business School, he completed the General Management Program in 2012. [4] [5] [6] [1] [7] [8] He is a chartered financial analyst. [3]
Prior to becoming president of Norfolk Southern in 2021 and CEO in 2022, Shaw was executive vice president and chief marketing officer at the company for six years. He had previously been vice president of intermodal operations at the company. His first vice president position at Norfolk Southern was vice president of chemicals, beginning in 2009. He also sits on the board of Virginia Wesleyan University. He sits on the boards of other educational institutions as well. [2] [1] [9] [7] [8]
When Shaw became CEO in 2022, he had 27 years of experience at Norfolk Southern in marketing, operations, and finance. [3]
In December 2022, Shaw announced a new strategy for Norfolk Southern at the company's Investor Day, the first since he became CEO, that placed less of a focus on operating ratio and precision scheduled railroading. Precision scheduled railroading is a method that the Class I railroads deployed to streamline operations, particularly during the COVID-19 pandemic. Shaw's strategy, instead, focuses on building the resources required to provide reliable service throughout the year, instead of frequently furloughing employees. The plan also includes investing in locomotives, track improvements, rail yards, technology, and employee training during economic downturns. [10] [11] [12]
Under Alan Shaw's management, Norfolk Southern has implemented several safety protocols as part of a six-point safety plan in which Norfolk Southern will add about 200 more hot bearing detectors to its rail network. [13]
In May 2023, Shaw and 12 union leaders, issued a safety letter to employees and union members committing to enhanced rail safety for employees and communities served by Norfolk Southern. [14]
Under Shaw, Norfolk Southern reported 37% fewer accidents on its main lines in the first 10 months of 2023 than in the same period of 2022. Norfolk Southern was the only one of the top five freight railroads with a decrease in accidents during this time period. [15]
He has drawn attention in the wake of the February 3, 2023 East Palestine railroad derailment of a 150-car train and chemical leakage in East Palestine, Ohio. [16] He visited the community in the week following the accident. He followed this with a public letter to the community, which began, "We will not walk away, East Palestine." On a second visit he met with the city's Mayor Trent Conaway, Congressman Bill Johnson, Fire Chief Keith Drabick, and first responders. [17] [18] On February 22, 2023, he appeared at a town hall on CNN hosted by Jake Tapper. In the town hall, he apologized to East Palestine residents, saying, "I'm terribly sorry for what has happened to your community." He added, "I want you to know that Norfolk Southern is here, and we're going to stay here. And we're going to make this right." [19]
Some Norfolk Southern investors criticized Shaw for a “tone-deaf response” to the Ohio derailment and for being given a 37% pay raise following the derailment. [20] The same year as Shaw’s pay raise, the company reported a 44% loss in net income. [20] In his defense, Shaw pointed to the company’s response to several challenges in 2023, saying that the company’s performance is expected to improve in 2024 with productivity gains and operational discipline. [21]
Shaw's compensation in 2023 increased by 37% in his first full year as CEO. His total pay grew from $9.8 million (US) in 2022 to $13.4 million (US) in 2023, with base improving to $1.1 million and stock options rising from $2.2 million to $10 million. [22]
While Norfolk Southern has donated to Ohio elected officials through its corporate PAC, Shaw has eschewed donating directly to politicians. Instead, he donates to the company’s good government fund. [23]
Shaw has pointed to resiliency as a key aspect of the company’s strategy. He has been praised for implementing customer-centric service and changing the culture. [24] In 2023, Shaw was awarded the Railroad Innovator Award by industry publications Progressive Railroading and Rail Trends. He has pointed to his upbringing as to how he developed the values of integrity and doing the right thing. [25]
Roughly half of Norfolk Southern’s unionized workers supported a proposal to remove Shaw at a May 2024 annual shareholder meeting. [26] However, the company said they had “full confidence in Shaw and his turnaround plan”. Two Teamsters unions representing employees announced they wanted Shaw replaced, [27] while the AFL-CIO announced its support. [28] One of NS's largest customers, Cleveland-Cliffs, also publicly announced its support of removing Shaw. [29]
The Teamsters’ decision to support firing Shaw was influenced by Shaw’s hiring of John Orr as COO. [30] Shaw and NS had to pay $25 million to Orr’s former employer to hire him. [31] Some investors criticized the hire for what they consider to be an excessive buyout package coupled with a record of racial and sexual discrimination allegations. [32] NS, however, defended Shaw and Orr, pointing to Orr’s record of improving performance and safety. [32]
Shaw survived the effort to oust him, with shareholders voting to keep Shaw in his position. [33]
The Union Pacific Railroad is a Class I freight-hauling railroad that operates 8,300 locomotives over 32,200 miles (51,800 km) routes in 23 U.S. states west of Chicago and New Orleans. Union Pacific is the second largest railroad in the United States after BNSF, with which it shares a duopoly on transcontinental freight rail lines in the Western, Midwestern and West South Central United States.
CSX Transportation, known colloquially as simply CSX, is a Class I freight railroad company operating in the Eastern United States and the Canadian provinces of Ontario and Quebec. Operating about 21,000 route miles (34,000 km) of track, it is the leading subsidiary of CSX Corporation, a Fortune 500 company headquartered in Jacksonville, Florida.
The Norfolk Southern Railway is a Class I freight railroad operating in the Eastern United States. Headquartered in Atlanta, the company was formed in 1982 with the merger of the Norfolk and Western Railway and Southern Railway. The company operates 19,420 route miles (31,250 km) in 22 eastern states, the District of Columbia, and has rights in Canada over the Albany to Montreal route of the Canadian Pacific Kansas City. Norfolk Southern Railway is the leading subsidiary of the Norfolk Southern Corporation.
Metra is the primary commuter rail system in the Chicago metropolitan area serving the city of Chicago and its surrounding suburbs via the Union Pacific Railroad, BNSF Railway, and other railroads. The system operates 243 stations on 11 rail lines. It is the fourth busiest commuter rail system in the United States by ridership and the largest and busiest commuter rail system outside the New York City metropolitan area. In 2023, the system had a ridership of 31,894,900, or about 152,400 per weekday as of the fourth quarter of 2023. The estimated busiest day for Metra ridership occurred on November 4, 2016—the day of the Chicago Cubs 2016 World Series victory rally.
CSX Corporation is an American holding company focused on rail transportation and real estate in North America, among other industries. The company was established in 1980 as part of the Chessie System and Seaboard Coast Line Industries merger. The various railroads of the former Chessie System and Seaboard Coast Line Industries that are now owned by CSX Corporation were eventually merged into a single line in 1986 and it became known as CSX Transportation. CSX Corporation currently has a number of subsidiaries beyond CSX Transportation. Previously based in Richmond, Virginia after the merger, the corporation moved its headquarters to Jacksonville, Florida, in 2003. CSX is a Fortune 500 company.
The Graniteville train crash was an American rail disaster that occurred on January 6, 2005, in Graniteville, South Carolina. At roughly 2:40 am EST, two Norfolk Southern trains collided near the Avondale Mills plant in Graniteville. Nine people were killed and over 250 people were treated for toxic chlorine exposure. The crash was determined to be caused by a misaligned railroad switch.
Conrail, formally the Consolidated Rail Corporation, was the primary Class I railroad in the Northeastern United States between 1976 and 1999. The trade name Conrail is a portmanteau based on the company's legal name. It continues to do business as an asset management and network services provider in three Shared Assets Areas that were excluded from the division of its operations during its acquisition by CSX Corporation and the Norfolk Southern Railway.
Pan Am Railways, Inc. (PAR) is a subsidiary of CSX Corporation that operates Class II regional railroads covering northern New England from Mattawamkeag, Maine, to Rotterdam Junction, New York. Pan Am Railways is primarily made up of former Class II regional railroads such as Boston and Maine Corporation, Maine Central Railroad Company, Portland Terminal Company, and Springfield Terminal Railway Company. It was formerly known as Guilford Transportation Industries and was also known as Guilford Rail System. Guilford bought the name, colors, and logo of Pan American World Airways in 1998.
The Fort Wayne Line and Fort Wayne Secondary is a rail line owned and operated by the Norfolk Southern Railway (NS), Chicago, Fort Wayne and Eastern Railroad (CFE), and CSX Transportation in Pennsylvania, Ohio, and Indiana. The line runs from Pittsburgh, west via Fort Wayne, Indiana, to Gary, Indiana, along what was once the Pennsylvania Railroad's Pittsburgh to Chicago main line.
Positive train control (PTC) is a family of automatic train protection systems deployed in the United States. Most of the United States' national rail network mileage has a form of PTC. These systems are generally designed to check that trains are moving safely and to stop them when they are not.
East Penn Railroad is a short-line railroad that operates a number of mostly-unconnected lines in Pennsylvania and Delaware. Except for two industrial park switching operations, all are former Pennsylvania Railroad or Reading Company lines, abandoned or sold by Conrail or its predecessors.
The Michigan Line, sometimes known as the Chicago–Detroit Line, is a higher-speed rail corridor that runs between Porter, Indiana and Dearborn, Michigan. It carries Amtrak's Blue Water and Wolverine services, as well as the occasional freight train operated by Norfolk Southern.
The Brotherhood of Maintenance of Way Employes (BMWE) – later to become the Brotherhood of Maintenance of Way Employes Division of the International Brotherhood of Teamsters (BMWED) – is a national union representing the workers who build and maintain the tracks, bridges, buildings and other structures on the railroads of the United States.
The Mon Line is an 85-mile long Norfolk Southern rail line which runs along the Monongahela River for most of its route.
A train derailment occurred on February 3, 2023, at 8:55 p.m. EST (UTC−5), when 38 cars of a Norfolk Southern freight train carrying hazardous materials derailed in East Palestine, Ohio, United States. Several railcars burned for more than two days, with emergency crews then conducting a controlled burn of several railcars, which released hydrogen chloride and phosgene into the air. As a result, residents within a 1-mile (1.6-kilometer) radius were evacuated, and an emergency response was initiated from agencies in Ohio, Pennsylvania, West Virginia, and Virginia.
At 4:25 pm on July 8, 1986, a 44 car Baltimore and Ohio railroad freight train, traveling at 45 miles per hour, bound south to Cincinnati, derailed near Miamisburg, Ohio, a small city with an industrial history in Montgomery County, southwest of Dayton. Fifteen of the cars derailed on a bridge; these were tank cars containing yellow phosphorus, molten sulfur and tallow. Carrying a chemical used to make rat poison, fireworks and luminescent coatings, one tank car caught fire. This resulted in emission of an estimated 1,000 foot (300 m) high cloud of phosphorus. A subsequent incident caused the largest train accident-triggered evacuation at the time in the United States. The accident was the second major rail disaster in Miamisburg within an eight-year period. On September 10, 1978, 15 cars of a Conrail train derailed.
On 4 April 2023, a freight train and a passenger train collided with construction equipment obstructing the line at Voorschoten, South Holland, Netherlands. The passenger train was derailed. The operator of the crane was killed and 30 people were injured, 19 of whom were hospitalized.
The employees say there were concerns among those working on the train over what they believed was the train's excessive length and weight — 151 cars, 9,300 feet long, 18,000 tons